How long do defaults or negative marks stay on my credit file?
Any time you don’t make a payment on time, that information is reported on your credit file just as your on time payments are reported. This is so that credit providers can have a look at what type of payer you are. This is what helps them to determine whether or not to extend you credit. When they see defaults and negative marks, they may not extend you credit or they may extend you credit as long as you meet certain conditions.
However, how long your defaults or negatives stay on your credit file depends on what kind of debt it is.
For example, you have enquiries. What this means is that there have been various creditors who have checked your credit file to see if you’re creditworthy. Each time they check, there is a mark placed upon your credit file. If you have too many of these marks, it is not favorable in the eyes of credit providers because that means your file has been checked, but those who enquired did not extend you credit. These marks stay on your account for a total of five years.
Overdue accounts also stay on your account for five years as well as data on any credit applications that you have filled out.
If you have what is called a “clearout,� which is when the credit provider has used all means necessary to get in touch with you about your debt, this will take 7 years to disappear from your credit report. This means that you need to make sure you take care of the debt or you will have to suffer the consequences of it for an additional two years. Bankruptcy information remains on your credit file for a total of seven years as well.
If you have any court judgments, that information remains on your credit file for five years, while writs and summons remain on your file for four years.
Important information such as your name, sex, date of birth, drivers license, linked names, address history, and any other identifying information is held throughout the life of the credit file. The only time this changes is if you change your information, such as address, on a credit application and it is reported to your credit file that way.
As far as when information is purged, this is based off of the Privacy Act of 1988. It depends on what date the information was added to the credit file and what the standard holding period is. For example, a clearout takes 7 years. The information was added on February 25, 2001. This means it was purged on February 25, 2008. Fortunately, files are scanned every month and information that is out of date is automatically purged to ensure the accuracy of the files. This means you do not have to worry about negative data being on your credit file longer than it needs to be.
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